Last week, the economy, inflation, and how they affect the lives of Americans took center stage. Going to the grocery store or gas station has become more painful than last year, and rising costs are impacting decisions for both households and businesses.
Here’s a snapshot of notable economic data and news from the past week and what it means for you.
Massive AI ramp-up brings latest inflation threat
US consumers and the Federal Reserve take another hit expensive headache.
Data center investment surges – perhaps Exceeded $700 billion This year to seize power artificial intelligence Not only electricity, but also memory chips, computer processors, and other equipment are becoming more expensive. Economists expect inflation to continue to rise until at least the end of this year.
It won’t be as big of a rally as it was from 2021 to 2023, when inflation peaked at 9.1%, but massive AI investments will likely keep prices rising faster than the Fed would like. With such an increase, central banks raise the main interest rate The aim is to cool spending and curb inflation in the second half of this year. Fed rate increases often increase borrowing costs for auto loans, mortgages, and business loans.
US inflation slows in June
us inflation cooled last month as the cost of gasclothing and used cars fell, bringing some relief to consumers, while underlying price pressures also cooled more than expected.
According to the Ministry of Labor, prices in June fell 0.4% from May, the largest monthly decline in four years. said on tuesday. On an annual basis, inflation fell to 3.5%, down from a year-on-year increase of 3.5%. 4.2% in May And it was lower than many economists expected.
Still, oil prices rose Tuesday of the second day as the united states New attack on Iran And President Donald Trump announced a new blockade of the Strait of Hormuz, a key shipping route that transports about a fifth of the world’s oil. Many Americans also feel the economy is suffering from five years of high inflation, posing a risk to President Trump and the Republican Party in the upcoming midterm elections.
Average U.S. 30-year mortgage interest rate rises to highest level in almost a year
average long term usa mortgage interest rate This week it rose to its highest level in almost a year, raising borrowing costs for prospective homebuyers.
Mortgage buyer Freddie Mac announced Thursday that its benchmark 30-year fixed-rate mortgage rate rose to 6.55% from 6.49% last week. A year ago, the average interest rate was 6.75%.
Rising mortgage rates can add hundreds of dollars in additional costs to borrowers each month, limiting homebuyers’ purchasing power at a time when affordability challenges continue to deter many aspiring homeowners.
Retail sales increase slightly amid economic uncertainty
Shoppers spent less in June than in May as economic uncertainty continued and the government’s generous tax rebates faded.
retail sales Prices rose 0.2% in June after rising a revised 1% in May, according to a report released Thursday by the Commerce Department.
Retail sales excluding gas station business increased 0.7%
Sales at clothing and accessory stores fell 0.3%, but online sales rose 1.9% due to spending around Amazon’s Prime Day event, which ran from June 23 to June 26.
U.S. producer prices fall, but outlook is uncertain
us wholesale inflation It fell from May to June due to a sharp drop in energy prices, but the outlook is uncertain due to escalating hostilities with Iran.
The Labor Department reported Wednesday that the producer price index, which tracks inflation before it reaches consumers, fell 0.3% from May. Compared to the same month last year, wholesale prices rose 5.5% in June, slowing from the 6% rise in the previous month. Gasoline prices fell 12% in June, but are still up nearly 43% from June 2025 due to the impact of the Iran war.
So-called core wholesale prices, which exclude volatile food and energy prices, rose 4.7% from June 2025 and 0.2% from May.
U.S. unemployment claims fall, the lowest in 10 weeks
application for unemployment allowance Last week it fell to its lowest level in 10 weeks as U.S. layoffs remain at historically low levels.
The Labor Department reported Thursday that the number of Americans who applied for unemployment aid in the week ending July 11 fell by 8,000 to 208,000. This is well below the 219,000 new filings predicted by analysts surveyed by data firm FactSet.
Weekly claims for unemployment benefits are considered a proxy for layoffs and are more of a real-time indicator of the health of the U.S. job market.
In its more comprehensive June employment report released earlier this month, the government reported that employers said: Withdrawal of recruitment in JuneThat would only add 57,000 jobs. This is less than half of last month’s total and shows that companies remain cautious in increasing headcount.
Global decline in AI stocks becomes more serious
further sales For computer chip companies and other award winners artificial intelligence technology the boom was pulled stock market Friday below. Meanwhile, crude oil prices continued to rise. war with iran.
The S&P 500 fell, on track to end its first down week in the past three weeks and just the third down week in the past 16 days. The Dow Jones Industrial Average and Nasdaq Composite Index fell.
Semiconductor stocks were again at the center of the decline. they have done so been under pressure for weeks They’re concerned that if AI ultimately doesn’t produce the profits and productivity it promises, prices will rise too high to sustain strong demand for computer memory and processors.
